The S&P 500 and the Dow Jones Industrial Average extended losses for the third straight week with respective declines of 2.7% and 1.4%. For the week ended Aug. 13, 2011, jobless claims in the U.S. rose 9,000 to touch 408,000, while the monthly expectation gauge for Bloomberg Consumer Comfort Index dipped to minus 34, the weakest since March 2009.

According to data compiled by international fund tracking firm EPFR, emerging market equity funds recorded $2.8 billion in outflows for the week ended Aug. 17. The MSCI's emerging market index has tracked its developed-nation counterpart this year, losing 15%, as against an 11% dip in the MSCI World (MXWO) Index. As per data from Bloomberg, emerging market shares are trading at a P/E of 9.7 times, less than 11 times for the MSCI World Index.

India Winners & Losers

India's Nifty was the top decliner among emerging market indices last week, with only a single gainer, as global growth concerns dented investors' sentiment. Moreover, the Reserve Bank of India is expected to raise interest rates in September to tame the demand-led inflation. A Bank of America Merrill Lynch fund manager said last week that India was the least favoured equity market among emerging market investors in August.

The majority of technology stocks experienced hefty losses on fears that Indian IT companies have significant revenue exposure to the U.S. and other European markets. Among others, Patni Computer Systems ( PTI), Infosys ( INFY) and Syntel ( SYNT) shed 11.5%, 11.3% and 10.9%, respectively. Infosys suffered a major setback after the company's CFO said the company reported its customers are seeking ways to cut down on spending.

The banking sector closed in the red last week, with major banking stocks ICICI Bank ( IBN) and HDFC Bank ( HDB) shedding 13.4% and 5.8%, respectively, on concerns that Indian banks could face collateral damage if a financial crisis returns to the global economy .